Settlement Agreements

NOTICE: None of these questions and answers constitute legal advice. To obtain legal advice, consult with an attorney. This is especially important in divorce and family law matters, in which outcomes are often peculiar to the particular facts and circumstances of the case.

In Maryland, spouses may make a valid and enforceable agreement that relates to alimony, support, property rights, or personal rights. Provisions regarding custody and visitation, child support, alimony, debts, pets, cars, household furnishings, health insurance, life insurance, retirement and survivor benefits, business interests, bank accounts and investments, and attorney fees may all be included in a separation agreement.

Yes. Parties often include provisions in separation agreements that are beyond a court’s power to order. However, once included in a separation agreement, such terms can be enforced by court order.

Yes. Separation agreements are generally favored by Maryland courts as a peaceful means of terminating marital strife and discord so long as they are not contrary to public policy.

Terms of a separation agreement, which has been incorporated into a divorce decree, are enforceable either through contempt proceedings or as an independent contract.

A Maryland court may modify any provision of an agreement with respect to the care, custody, education, or support of any minor child of the parties, if the modification would be in the best interests of the child.

In addition, a Maryland court may modify any provision of an agreement with respect to alimony or spousal support executed on or after April 13, 1976, regardless of how the provision is stated, unless there is: (1) An express waiver of alimony or spousal support; or (2) A provision that specifically states that the provisions with respect to alimony or spousal support are not subject to any court modification.

A separation agreement is subject to the same general rules governing all contracts, and particular questions must be resolved by reference to particular language of the agreement. The primary source for determining the intention of the parties is the language of the contract itself. However, a contract is not ambiguous just because the parties to it disagree as to its meaning.

A Maryland court is required to give effect to an agreement’s “plain meaning,” without regard to what the parties actually thought it meant or intended it to mean. The terms of an agreement are given their usual and ordinary meaning, unless it is clear that the parties assigned a special or technical meaning to certain words. Put another way, the test of what is meant is what a “reasonable person” in the position of the parties would have thought the contract meant.

Contractual language is considered ambiguous when the words used would tend to have more than one meaning to a “reasonable person.” To determine if contractual language is ambiguous, a Maryland court reviews the contract itself; it must also consider the character of the contract, its purpose, and the facts and circumstances of the parties at the time the contract was executed.

Remember, it is not the court’s task to rewrite an agreement to correct an ambiguity, to avoid hardship to a party, or because one party has become dissatisfied with its terms. However, when the court finds an agreement ambiguous, the court may receive evidence to clarify its meaning.

As with other contracts, a separation agreement is voidable, and subject to “recision” (meaning cancellation or annulment), if it can be shown that it was unconscionable or was obtained through fraud, duress, or undue influence. These are usually difficult to prove. For example, to establish duress there must be a wrongful act which strips the individual of the ability to utilize his or her free will.

Usually, a party may not affirm the favorable part of a separation agreement, or accept its benefits, and avoid the unfavorable part.

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